Pay equity is a means of eliminating
sex and race discrimination in the wage-setting system.
Many women and people of color are still segregated
into a small number of jobs such as clerical, service
workers, nurses and teachers. These jobs have historically
been undervalued and continue to be underpaid to a large
extent because of the gender and race of the people
who hold them. Pay equity means that the criteria employers
use to set wages must be sex- and race-neutral.

Q:

What
is the legal status of pay equity?

A:

Two laws protect workers against wage
discrimination. The Equal Pay Act of 1963 prohibits
unequal pay for equal or "substantially equal"
work performed by men and women. Title VII of the Civil
Rights Act of 1964 prohibits wage discrimination on
the basis of race, color, sex, religion or national
origin. In 1981, the Supreme Court made it clear that
Title VII is broader than the Equal Pay Act, and prohibits
wage discrimination even when the jobs are not identical.
However, wage discrimination laws are poorly enforced
and cases are extremely difficult to prove and win.
Stronger legislation is needed to ease the burden of
filing claims and clarify the right to pay equity.

Q:

How
large is the wage gap?

A:

2013 Median Annual Earnings
of Year-Round,
Full-Time Workers

All Men All
Women
$50,033 100% $39,157 78%

In 2013, the earnings of African American women were $34,089, 68.1 percent of all men's earnings, a slight decrease from 68.6 percent in 2012, and Latinas' earnings were $30,209, 60.4 percent of all men's earnings, an increase from 57.5 percent in 2012. Asian American women's earnings of $42,335 were 84.6 percent of all men's earnings, a decrease from 92 percent in 2012. The National Committee on Pay Equity's The Wage Gap Over Time shows how little the wage gap has changed in this century.

Source: U.S. Census Bureau, Current Population Survey, 2014 Annual Social and Economic Supplement, Series PINC-05

Q:

Why
is there a wage gap?

A:

The wage gap exists, in part, because
many women and people of color are still segregated
into a few low-paying occupations. More than half of
all women workers hold sales, clerical and service jobs.
Studies show that the more an occupation is dominated
by women or people of color, the less it pays. Part
of the wage gap results from differences in education,
experience or time in the workforce. But a significant
portion cannot be explained by any of those factors;
it is attributable to discrimination. In other words,
certain jobs pay less because they are held by women
and people of color.

Q:

Hasn't
the wage gap closed considerably in recent years?

A:

The wage gap has narrowed by about 15 percentage points during the last 23 years, ranging from 62 percent in 1982 to 77 percent in 2010. Since 1973, however, approximately 60 percent of the change in the wage gap is due to the fall in men's real earnings and only about 40 percent to the increase in women's wages. At this rate of change, the Institute for Women's Policy Research estimates that it will take 50 years to close the wage gap.

Q:

Is
it possible to compare different jobs?

A:

Yes, employers
have used job evaluations for nearly a century to set
pay and rank for different occupations within a company
or organization. Today, two out of three workers are employed
by firms that use some form of job evaluation. The federal
government, the nation's largest employer, has a 70-year
old job evaluation system that covers nearly two million
employees.

Q:

Who
really needs pay equity?

A:

Women, people
of color, and white men who work in jobs that have been
undervalued due to race or sex bias need pay equity. Many
of these workers are the sole support for their families.
In addition, it is estimated that 70 percent of women
with children under 18 work outside the home. (Up from
44.9 percent 20 years ago.) Discriminatory pay has
consequences as people age and across generations. Everyone
in society is harmed by wage discrimination. Therefore,
everyone needs pay equity.

Q:

Is
pay equity an effective anti-poverty strategy?

A:

Yes, pay equity
helps workers become self-sufficient and reduces their
reliance on government assistance programs. A recent study
found that nearly 40 percent of poor working women could
leave welfare programs if they were to receive pay equity
wage increases. Pay equity can bring great savings to
tax payers at a minimal cost to business. Adjustments
would cost no more than 3.7 percent of hourly wage expenses.

Q:

Will
the wages of white men be reduced if pay equity is implemented?

A:

No, Federal
law prohibits reducing pay for any employee to remedy
discrimination. Furthermore, male workers in female-dominated
jobs benefit when sex discrimination is eliminated, as
do white workers in minority-dominated jobs. Pay equity
means equal treatment for all workers.

Q:

Will
achieving pay equity require a national wage-setting system?

A:

No, pay equity
does not mandate across-the-board salaries for any occupation,
nor does it tamper with supply and demand. It merely means
that wages must be based on job requirements like skill,
effort, responsibility and working conditions without
consideration of race, sex, or ethnicity.

Q:

Doesn't
pay equity cost employers too much?

A:

In Minnesota,
where pay equity legislation meant raises for 30,000 state
employees, the cost was only 3.7 percent of the state's
payroll budget over a four-year period--less than one
percent of the budget each year. In Washington State,
pay equity was achieved at a cost of 2.6 percent of the
state's personnel costs and was implemented over an eight-year
period. Voluntary implementation of pay equity is cost
effective, while court-ordered pay equity adjustments
can lead to greater costs. Discrimination is costly and
illegal.

Q:

Are
wage inequalities the result of women's choices?

A:

Again, part
of the wage gap is attributed to differences in education,
experiences and time in the work force. However, the overwhelming
evidence that wage discrimination persists in America
can be found in numerous court cases and legal settlements,
Department of Labor investigations, surveys of men and
women on the job, and salary surveys that control for
age, experience and time in the workforce. While women
sometimes take time out of the workforce to raise children,
it should be noted that when couples are deciding who
should stay home with children, the fact that the wife
is earning a lower salary impacts that decision. In addition,
some of the other explainable factors can sometimes be
attributed to discrimination. For example, if women and
men have different jobs in a company, women may not be
choosing the lower paying jobs. They may have trouble
advancing in a company due to bias about women's abilities
or levels of commitment.

Q:

Will
implementing pay equity disrupt the economy?

A:

No. The Equal
Pay Act, minimum wage, and child labor laws all provoked
the same concerns and all were implemented without major
disruption. What disrupts the economy and penalizes families
is the systematic underpayment of some people because
of their sex or race. When wages for women and people
of color are raised, their purchasing power will increase,
strengthening the economy. One survey found that a growing
number of businesses support the elimination of wage discrimination
between different jobs as "good business" and
that pay equity is consistent with remaining competitive.

Q:

What
is the status of efforts to achieve pay equity?

A:

Pay equity is a growing national movement building on the progress made in the 1980s, when twenty states made some adjustments of payrolls to correct for sex or race bias. (Seven of these states successfully completed full implementation of a pay equity plan. Twenty-four states plus Washington, DC conducted studies to determine if sex was a wage determinant. Four states examined their compensation systems to correct race bias, as well.)

In recent years, pay equity bills have been introduced in more than 25 state legislatures. On the federal level, two bills have been introduced since the mid-1990s, the Paycheck Fairness Act and the Fair Pay Act. The Paycheck Fairness Act, which would amend the Equal Pay Act and the Civil Rights Act of 1964 to provide more effective remedies to workers who are not being paid equal wages for doing equal work, was passed by the House of Representatives in the 110th and 111th Congresses. Hearings on the bill were held March 11, 2010 in the Senate, but it was defeated by a 58-41 vote on Nov. 17, 2010. The Fair Pay Act would expand the Equal Pay Act's protections against wage discrimination to workers in equivalent jobs with similar skills and responsibilities, even if the jobs are not identical.

Q:

What
can I do about pay equity?

A:

Urge your senators to support the Paycheck Fairness Act (S.182). The Senate Health, Education, Labor, and Pensions Committee held a hearing, "Fair Share for All: Pay Equity in the New American Workplace" on March 11, 2010, with testimony about the Paycheck Fairness Act; see www.womenspolicy.org.

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